Army-Help a Joe out:)?

Army-Help a Joe out:)?

Im in the Army and am overwhelmed of where to start:

Im stationed in Louisiana but have a house in Maryland. My house facts are:

1. Owe on house: 130,000, house value $155,000-165,000 (online resources such as zillow say about $152,000 but other houses in neighborhood are selling for $170,000)

I have renters in there now paying $1100. I want to make about 300 a month. My current mortgage is locked in at 6 b/c Im in Army (Servicemembers Civil Relief Act) but is an ARM.

My question is: Should I refinance and take out a HELOC for downpayment on investment properties here in Louisiana:

1. Can I refi with a VA loan? I understand then that I wouldnt have any to little out of pocket expenses-is this true? Can I refi and do a HELOC at same time-figured this may help out.
2. Should I do a 5/1 ARM to get a lower rate and make more money or should I get a conventional fixed loan with a higher interest rate and buy down a point or so (want to be at about 4.5%)

My credit is score is 764 so pretty good I think.

3. Where do I go to get a loan? Should I go to a broker or look for best rate online and then call directly? If broker, can anyone recommend one?

Sorry for all the questions but I am a bit overwhelmed!

Very Respectfully,



Help for our finest

These are all great questions Gary, if you are planning to keep this property long term you should refinance this home into a fixed interest rate. Right now the rates are great and you should look to take advantage of this. Right now you should:

1. Contact at least 3 different lenders in your area and shop the rates and fees that will be charged by the different lenders. You can do this by asking for a good faith estimate or a fee schedule of all the fees that will be associated with the transaction. Now these lenders will tell you they have to pull your credit to do this - that is not true! You know what your credit score is, let them know you are shopping for the best deal. So whoever has the lowest closing costs and the best interest rate that is the lender that will most likely earn your business.

I would not recommend that you shop online. Many of these lenders promise much, but when it comes to performing they have trouble coming through at the end when its closing time. Atleast with a local lender you can go in and talk with this the lender if there are problems.

As for a HELOC most lenders will only loan up to 85% of appraised value. Right now many lenders will do this for free or very little money. It is a great idea to have money available at any time to take advantage of great deals and not be charged interest on the money. You should according to the new VA guidelines be able to get 100% of value out of the refinance but would be paying interest on the money borrowed but it is an extra 15%.

Now using your VA option to refinance would be a great idea, our congress did sign a bill removing the cap that raised VA’s maximum loan amount for ARM loans. Previously, these refinancing loans were capped at $144,000. With the new legislation, loans can be made up to $729,750 depending on where the property is located. You could refinance to a good fixed rate, and then get a HELOC that is next to free, all with the same lender possibly. You have an excellent opportunity in front of you and have definately earned it by serving our great nation.

For more information, or to obtain help from a VA Loan Specialist, veterans can call the VA at 1-877-827-3702 or visit


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